California Gov. Schwarzenegger, U.S. Treasury Sec. Paulson Discuss Help for Homeowners Facing Foreclosure

12/18/2007 -- California Governor Arnold Schwarzenegger, joined by U.S. Treasury Secretary Henry Paulson Jr. and Stockton community leaders, including Mayor Edward Chavez, held a town hall today to discuss ways to help homeowners in Stockton and across the state avoid foreclosure. According to the latest data from RealtyTrac, Stockton had one foreclosure filing for every 31 households during the last quarter, the highest foreclosure rate among the nation's 100 largest metro areas.

"No other state is more affected by the subprime mortgage crisis than California. We need to continue to find solutions to this critical problem because foreclosures don't just hurt homeowners, they have an effect on all Californians through the economy and our state budget," said Governor Schwarzenegger. "The most important thing is borrowers must be proactive and communicate with lenders before foreclosure. By working together we can keep more Californians in their homes, keep our economy strong and help reduce pressure on the state budget."

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Participants in today's town hall included:

* U.S. Treasury Secretary Henry Paulson Jr.
* Stockton Mayor Edward Chavez
* Business, Transportation & Housing Agency Secretary Dale Bonner
* State and Consumer Services Agency Secretary Rosario Marin
* NeighborWorks HomeOwnership Center Sacramento Region Executive Director Pam Canada
* Assemblymember Greg Aghazarian (R-Stockton)
* Senator Michael Machado (D-Linden)
* California Department of Corporations Commissioner Preston DuFauchard

Additionally, members of the Greater Stockton Chamber of Commerce and San Joaquin Hispanic Chamber of Commerce, as well as homeowners in the Stockton area, attended today's town hall.

"We want, when possible, to minimize the housing market downturn's impact on the national economy, California's economy and cities like Stockton," said U.S. Treasury Secretary Paulson Jr. "A spike in home foreclosures can pose costs for whole neighborhoods, causing property values to decline and crime to increase. This can undermine the financial stability of neighboring families and communities."

Earlier this month, Governor Schwarzenegger joined the OneCalifornia Foundation to announce a bridge loan fund for homeowners facing foreclosure in Oakland, which has the tenth highest foreclosure rate in the nation. The Governor also highlighted the role that other foundations, non-profits and banks statewide can play in preserving homeownership across the state.

The OneCalifornia Foundation Bridge Loan Fund is designed to assist homeowners that don't qualify for other assistance, such as Governor Schwarzenegger's agreement with loan servicers from Countrywide, GMAC, Litton and HomEq or President George W. Bush's nationwide arrangement with subprime lenders.

The following additional resources are available for homeowners:

* The "HOPE Hotline" (1-888-995-HOPE or http://www.995hope.org/) provides free mortgage counseling 24 hours a day, seven days a week.
* The website http://www.yourhome.ca.gov/ has helpful information for prospective homebuyers, as well as homeowners who are experiencing difficulty in keeping payments current. The Spanish language version can be found at: http://www.sucasa.ca.gov/.

Last month, Governor Schwarzenegger launched a $1.2 million public awareness campaign - funded through existing consumer education efforts within the Business, Transportation and Housing Agency and the State and Consumer Services Agency - to help educate homeowners about options that can help them avoid losing their homes to foreclosures. He also announced an agreement with four loan servicers - representing 25 percent of the market - to streamline the loan modification process for subprime borrowers living in their home.

Earlier this year, Governor Schwarzenegger signed legislation to increase protections for Californians who own or plan to purchase homes and to expand affordable housing opportunities. The Governor has also lobbied Congress to raise federal loan limits so that more California families can take advantage of these secure products, rather than relying on subprime loans.

California's home foreclosure rate is twice the national average. Seven of the top 16 metropolitan areas with the highest rates of foreclosures in the nation are in California, according to the latest data from RealtyTrac.

Source: California Governor